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Second Appeal Summary
PA ID# XXX-XXXXX; Walsh County
DSR ID# N/A; Audit Report No. W-23-00
Citation: FEMA-1157-DR-ND; Walsh County; Walsh County Audit Report No. W-23-00
Cross Snow Removal; Force Account; Audit; Documentation; Road-Mile Method
Summary: Following the severe winter storm disaster declaration in North Dakota in January 1997, FEMA developed a methodology for determining eligible costs for force account snow removal. Eligible project funding was based on the number of road miles that were cleared of snow. This was intended to reduce the administrative and documentation burdens on the applicant during the process of preparing and obligating Damage Survey Reports (DSRs). The Executive Associate Director of the Response and Recovery Directorate approved the methodology by a memorandum which stipulated that upon audit, subgrantees would be required to document snow removal costs at least to the level of their FEMA eligible amount. A later audit by the Office of Inspector General found that Walsh County was unable to provide appropriate source documentation to support the expenditure of $42,668 of FEMA funds. Following the audit, the Regional Director requested that the State return these funds to FEMA. The State's first appeal asserted that FEMA's written procedures for using the road-mile methodology only required documentation supporting the mile rate and the number of miles cleared of snow. The State also cited a memorandum from a member of FEMA Region VIII staff that stated that the State should process the large projects using the road-mile methodology in the same manner that small projects are processed. The Regional Director denied the first appeal stating that the simplified procedures for determining project funding did not waive any requirements for maintaining accounting records and source documentation as specified in 44 CFR Part 13. In the second appeal, the State asserts that FEMA instructed applicants that the road-mile rate and the number of miles cleared were the only source documentation required. The State also asserts that a waiver of Part 13 documentation requirements was unnecessary, as there was a non-written agreement with FEMA that the applicants were only required to keep the road-mile documentation.
Issues: Is the road mile methodology documentation acceptable for audit purposes?
Findings: Yes. The procedural guidance provided by FEMA stated that the final DSR costs would be determined using the road mile methodology. Therefore, an exception to the documentation requirements is being made.
Rationale: There is no information that demonstrates that FEMA clearly informed applicants that an audit would require additional cost documentation beyond what was required to develop the road mile cost estimate. 44 CFR 13.6(c).